"In California, we're aware. We're very aware that the pain felt by homeowners is deeper than in any other state," said Shum Preston, spokesman for the Attorney General. "And that creates an opportunity for predators to come in and try to take advantage of those homeowners."

Federal officials say the reports of suspicious activity help them locate and root out fraud. The California Attorney General's office said it is no surprise that there's a lot of mortgage fraud activity in California.

"The housing and mortgage downfall have hurt our housing economy more than in any other state," Preston said. "So it's not surprising at all, it's what I would expect, and it's why California has put together a dedicated mortgage fraud strike force."

That state task force finds and prosecutes people involved in mortgage fraud schemes.

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